What are Affiliates?

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Affiliate networks bring together and manage the relationship between website publishers and advertisers. Also known as partner networks, these activities allow companies to establish affiliate programs, recruit publishers, and maintain standards of accountability and transparency between both parties. In addition to managing relationships, affiliate networks typically provide the technology and programming upon which an affiliate program operates. Affiliate networks give merchants access to cost-effective advertising and help make website publishing profitable.

An affiliate program is an online advertising scheme that allows businesses to advertise on other websites and blogs without having to pay for the ad itself. Instead, an affiliate merchant pays a website publisher for sales generated from ad placement. For example, a webmaster places a merchant’s banner ad on her website. Every time a visitor clicks on the banner and buys something from the advertiser’s shop, the webmaster receives a percentage of the sale. If the website visitors do not click on the ad and buy the merchant’s offers, the webmaster does not earn any money from the ad placement.

The key to a successful affiliate program is the ability of online merchants to recruit well-trafficked websites whose visitors are likely to purchase the merchant’s offerings. Affiliate networks provide a hub where web merchants and publishers meet. For example, a bicycle blog owner might use an affiliate network’s search engine to find companies that sell bicycles, bicycle tools and components, and cycling equipment. The blogger can apply for the program and once the merchant approves the report, the blogger posts the merchant’s announcements on his blog. Merchants can also use affiliate network search engines to locate websites targeted at the merchant’s clientele.

Because running an affiliate program requires specialized web software, money management, and fraud prevention measures, many merchants need to contract with a third party to provide these services. Affiliate networks often feature merchant ads on partner website pages, which means that all webmasters need to do is add some JavaScript or HTML to their sites to activate merchant ads. More importantly, affiliate networks often handle webmaster payments for merchants. Merchants add funds to an account held by their affiliate network, and the affiliate network records traffic and purchases so it can pay webmasters directly. By having a third party monitor the performance of the affiliate program and ensuring payments are made to the webmasters, participants can have more confidence in participating in their affiliate program.

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